Impax Laboratories Inc. (IPXL) failed to win U.S. approval for a new version of an extended-release drug used to relieve spasms in patients with Parkinson’s disease. The Food and Drug Administration requires a re-inspection of a plant involved in the development of the medicine called Rytary, which combines standard Parkinson’s medications in a new sustained release formulation, the Hayward, California-based company said today in a statement. A warning letter was issued in May 2011, Impax said. “We will work with the FDA on the appropriate next steps for the Rytary application,” said Larry Hsu, president and CEO of Impax, in the statement. “We remain committed to resolving the warning letter and bringing this new treatment option to patients who are suffering from Parkinson’s disease.” The medication would likely be used most among patients for whom the standard medicines, levodopa and carbidopa, have stopped working as reliably, said David Amsellem, an analyst with Piper Jaffray & Co. in New York. Rytary could generate peak sales of $200 million to $300 million, Amsellem said. “A controlled-release product is something that has been elusive over the years,” Amsellem said in a telephone interview. Impax, which specializes in controlled-release drugs, will develop and sell Rytary in the U.S. and Taiwan while GlaxoSmithKline Plc (GSK), based in London, will market it in other regions throughout the world. Impax already markets a generic version of a longer-acting combination called Sinemet, sold by Merck & Co. (MRK). Merck’s Sinemet extended-release carbidopa-levodopa tablet received approval in 1991 though it’s not widely used, Amsellem said. People who use it are more likely to suffer impairment of voluntary movement than those who use the immediate-release version, according to the label for the medication.